Facebook, Zynga lead tech-stock losses

Social-media stocks slump, eBay makes gains following redesign

SAN FRANCISCO (MarketWatch) — Losses from Facebook Inc. and Zynga Inc. were among those that stood out Wednesday as the tech sector ended the day with broad declines.

Facebook
FB, -0.30%
gave up nearly 3% to close at $19.64 a share in the wake of concerns about the social network’s revenue estimates for next year, as well as issues surrounding its mobile-ad business.

Oppenheimer & Co. analyst Jason Helfstein said in a research note that a slowdown in desktop usage of Facebook’s services suggest that analysts’ estimates for 2013 are too high. Helfstein based his rationale on data compiled by comScore that he said showed Facebook’s desktop usage dropping 20% last month from September 2011.

Separately, a Bloomberg news article said that Facebook had fought the Securities and Exchange Commission over divulging more information about its mobile-ad business prior to the company’s initial public offering last May. See: Facebook loses gains sparked by Zuckerberg.

Zynga
ZNGA, +1.08%
trimmed its losses, but still gave up 3.5% to close at $2.35 a share. Piper Jaffray analyst Michael Olson downgraded the social-game company to a neutral rating from overweight, saying in a research note that a drop in bookings this year will likely continue into 2013.

Olson also said that a recent survey of 7,700 teenagers showed that social gaming “is as unpopular among teens as we have ever seen.”

Can Zynga get its mojo back?

(2:39)

Following an analyst downgrade, social games maker Zynga saw its shares fall, MarketWatch’s Dan Gallagher reports.

Other tech stocks losing ground included Dell Inc.
US:DELL
down 1.4%, Cisco Systems Inc.
CSCO, -2.24%
which fell by 2.6%, NetApp Inc.
NTAP, -1.40%
off by 3% on the day, and Hewlett-Packard Co.
HPQ, -0.97%
which fell 1.3% and online review site Yelp Inc.
YELP, +1.34%
which saw its shares give up 6.6% to stand at $25.71.

The losses weighed on the momentum of the Nasdaq Composite Index
COMP, -0.56%
which fell 13 points to close at 3,051. The Philadelphia Semiconductor Index
SOX, -1.93%
ended the day down by 1.4% while the Morgan Stanley High-Tech Index
MSH, -1.05%
gave up almost 1%.

Microsoft Corp.
MSFT, -1.34%
shares gave up 1% to close at $28.98. On Tuesday, Microsoft Corp.
MSFT, -1.34%
Chief Executive Steve Ballmer said that Netflix CEO Reed Hastings would step down from Microsoft’s board of directors next month. Hastings had been on Microsoft’s board for more than five years.

Reuters

Microsoft CEO Steve Ballmer.

Microsoft also said in a Securities and Exchange Commission filing that it had cut Ballmer’s bonus for this year, mostly due to weak performance in the company’s online services division. Ballmer will get a bonus of $627,000, which is less than half of the $1.37 million maximum for which he was eligible.

Ambarella Inc.
AMBA, +1.71%
shares rose 6 cents to close at $6.06 as the maker of high-definition video chips made its public debut. Ambarella had priced 6 million shares of stock at $6 each after earlier expecting between $9 and $11 a share.

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